Temporal relational graph convolutional network approach to financial performance prediction

• Main Authors: JEYARAMAN BRINDHA PRIYADARSHINI, DAI, Bing Tian, FANG, Yuan
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2024
• Subjects: knowledge graph; finance; BERT; tweets; text; LSTM; RGCN; news; NLP; commercial entities; concept entities; Databases and Information Systems; Finance and Financial Management
• Online Access: https://ink.library.smu.edu.sg/sis_research/9618; https://ink.library.smu.edu.sg/context/sis_research/article/10618/viewcontent/make_06_00113_pvoa_cc_by.pdf
• Institution: Singapore Management University

Accurately predicting financial entity performance remains a challenge due to the dynamic nature of financial markets and vast unstructured textual data. Financial knowledge graphs (FKGs) offer a structured representation for tackling this problem by representing complex financial relationships and concepts. However, constructing a comprehensive and accurate financial knowledge graph that captures the temporal dynamics of financial entities is non-trivial. We introduce FintechKG, a comprehensive financial knowledge graph developed through a three-dimensional information extraction process that incorporates commercial entities and temporal dimensions and uses a financial concept taxonomy that ensures financial domain entity and relationship extraction. We propose a temporal and relational graph convolutional network (RGCN)-based representation for FintechKG data across multiple timesteps, which captures temporal dependencies. This representation is then combined with FinBERT embeddings through a projection layer, enabling a richer feature space. To demonstrate the efficacy of FintechKG, we evaluate its performance using the example task of financial performance prediction. A logistic regression model uses these combined features and social media embeddings for performance prediction. We classify whether the revenue will increase or decrease. This approach demonstrates the effectiveness of FintechKG combined with textual information for accurate financial forecasting. Our work contributes a systematic FKG construction method and a framework that utilizes both relational and textual embeddings for improved financial performance prediction.